The entire situation whereby a dealer is permitted to take your cash and payoff the loan to get the title released has always caused me significant pause.

After you hand over the money, you have absolutely no assurance that those funds are used to actually payoff the lien and you have absolutely no assurance that the title will ever be released.

This behavior is considered typical in the auto resale industry where it would never be tolerated in any other industry. You're buying the vehicle and the title to that vehicle. If they can't deliver both, they are not entitled to the money, IMHO.